Simulation-based decision-making system for optimal mine production plan selection

Jyrki Savolainen (), Ramin Rakhsha () and Richard Durham ()
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Jyrki Savolainen: LUT-University
Ramin Rakhsha: University of Western Australia
Richard Durham: University of Western Australia

Mineral Economics, 2022, vol. 35, issue 2, No 6, 267-281

Abstract: Abstract Price uncertainty is one of the major uncertainties in the life of mine (LOM) planning process which can have a decisive effect on the overall profitability. Today’s mine planning software tools provide block-sequencing optimisation for a given static price assumption that is then used as a basis of managerial decision-making process. This paper proposes a complementary approach to this by introducing a simulation-based decision-making tool that, with the help of simulation, seeks for the optimal mine plan when a managerially estimated price development with minimum and maximum boundaries is used as a data input for the given period. To demonstrate the approach, a realistic gold mine case study is presented with five alternative and technically feasible mine plans calculated in a static optimiser from a commercial mine planning software package. These mine planning scenarios are then subjected to price uncertainty in simulation with and without a price trend assumption to highlight the effect of price on the mine’s expected performance. Based on the results, we derive and demonstrate a simulation-based system that automates the matching of optimal mine plan with the managerial insight of long-term price development.

Keywords: Mine planning; Uncertainty modelling; Simulation; Managerial decision-making (search for similar items in EconPapers)
Date: 2022
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Citations: View citations in EconPapers (1)

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DOI: 10.1007/s13563-021-00297-w

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